Kerala HC allows Income Tax Deduction to South Indian Bank on Long-Term Finance Provided for Purchase of Residential

The Kerala High Court allowed South Indian Bank to claim income tax deduction on long-term finance provided for purchasing residential houses. The court upheld the bank's contention that such financing qualifies for deduction under Section 36(1)(viii) of the Income Tax Act, which allows deductions for bad and doubtful debts in relation to advances made by a scheduled bank. The decision supports the bank's position that the long-term finance provided for residential properties should be considered as advances eligible for deduction, despite the absence of specific provisions in the Act. This ruling clarifies the tax treatment applicable to banks providing finance for housing purposes.